Walmart Prepares For New Push Into Major Urban Areas

By cwaltersNovember 4, 2009

If you live in Chicago, New York City, or Philadelphia, expect to start hearing some noise about Walmart in the coming months. The retailer has announced that it’s going to “step up efforts to mobilize local political support” so that it can finally open stores in those cities, reports the Financial Times.

You may have noticed that Walmart’s being doing a ton of work on rehabilitating its reputation, mostly in the area of environmental sustainability, where it went from being a nobody to a leader in the field almost overnight. At the same time, over the past several years the company has been quietly laying the groundwork for a second attempt at growing into urban areas, after being turned back in Chicago and Los Angeles in 2004. Here are some of the things it’s been working on according to the Financial Times:

creating a “more responsive regional management structure;”

hiring local political consultants;

establishing online “community action networks” to provide a grassroots show of support;

adjusting its charitable giving strategy to include minority groups in Chicago, New York, and Philadelphia; and

“encouraging minority suppliers to do business at its stores.”

I don’t know about Chicago and Philly, but NYC has Targets, Kmarts, three Costcos, an IKEA, and now even a JCPenney in the middle of Manhattan. Somehow it doesn’t seem that ruinous anymore to imagine a Walmart mixed in there somewhere.

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I agree completely. Inner city residents pay higher prices than they need to. It’s been a damn shame for a long time that WalMart has not set up shop in a place where they could liberate the economically disadvantaged people with limited transportation and older people on a fixed income from the confiscatory pricing of the local stores.

This will do more to improve these people’s lives than all of the Hope & Change giveaway programs that you could stuff in a dump truck.

@Snarkysnake: Yeah, cuz the Deep South is filled with small businesses, thriving local industry, even manufacturing jobs as a result of Wal-Mart’s lockjaw on their entire retail chain. One HECK of a diverse, thriving, multicultural, competitive environment they have down there. First in nation!
Well, and the Big Gulp guys and that clown fellah.

Wal-Mart’s JOB is to expropriate money from localities and give it to their investors. (Well, all companies, but Wal-Mart is especially skilled at it)

Nope. The south is a fine place to live. WalMart has no more influence here than we give it with our patronage.

I stopped being offended by people that put down the south that I grew up in and call home today many ,many years ago. It’s just ignorance dressed up as enlightenment.

Why don’t you just come out and admit that you think that you are smarter ,more urbane and advanced than the people that choose to shop at Walmart ? C’mon , isn’t that how you measure your enlightenment ?

@Snarkysnake: OK, but here’s the thing. People say Wal-Mart has no impact on local economies and that they’re a force for thriving, diverse, competitive retail environments.
So, this should be shown in real-world results. But I suspect you’ve got a retail monoculture there, or at least one that’s oligarchic and dominated by Wall Street, not Main Street. And, correspondingly, all the feeders to these oligopolies have withered on the vine, so no local manufacturing either. All of these point to a Big Picture FAIL for how Wal-Mart impacts the regions they dominate.

And, umm, why is your bias against educated people so strong? Against rationality? Against seeing the Big Picture? Americans are supposed to be smarter, not stupider, right?

@metsarethe…: I am so tired of seeing Sonic ads. I thought it was just Western, NY getting hit by those. They are on all the time and there isn’t a location in site. I am so sick of seeing them that when they finally do open a location I won’t even have a desire to go to it.

@gqcarrick: for a time, Sonic was the largest national cable ad buyer. Even though they aren’t everywhere, they felt the need to buy cable on a national level. I used to get very excited when I’d head down south and be near a sonic, it was as fun treat once a year. Now there is one a mile away from me, since it opened about a year ago, I’ve been there twice.

@metsarethe…: Totally over rated. We finally got them here and they were great for the first few weeks. Then the food went to crap. Rancid filthy fry grease does horrible things to the digestive system.

@bohemian: I have fond and not so fond memories (sometimes simultaneously) of Sonic runs during college. I had never seen a Sonic until I went to college, and marveled at this whole novel concept of a car hop. Then I marveled at the giant burgers and then fell into a deep, deep misery after eating one.

Some New Yorkers were pissed off when Kmart came to town. They were outside the store protesting. They didn’t even know what to say. They were like, ‘Down with Kmart and their merchandise that people can afford. Down with Kmart and their 300 gallon drum of laundry detergent for 99 cents. Why don’t you go take your good values to another town?’

Wal Mart pretty much just wants to open everywhere. they have 2 stores within 30 miles of us and a town that’s 15 miles away is getting a second, bigger, Wal Mart. there are also plans for my town to get one but alas no construction has begun.

I don’t know where to stand on this one. On one hand, it’s gonna hurt small businesses, and maybe take away from the character of certian places. On the other hand, it could be good for some places, especially Philadelphia (in the center of the city itself..there are several Wal-Marts and Targets once you get out of the downtown areas), where your choices are pretty limited to the shady corner bodega or a run-down Kmart. Hell, if they want to open a store and create some kind of jobs in this economy, let them. Good luck getting a job with some kind of benefits at the run-down bodega. I have a feeling there is going to be a lot less opposition compared to 4 or 5 years ago. And have you ever seen prices on basic items in NYC? Maybe Walmart can bring all the other shady and/or rip off stores in line.

@mbz32190: I’m curious exactly where in/near Philly they plan to be. I know there’s one or two but depending where you live it would take the better part of a day just to get there and back. I grew up on the Main Line and even though I moved away years ago I still hear locals say how they wish they had just the *option* of going to Walmart on a whim, they actually envy that I have a plethora of walmarts that I can go to out here in the sticks where I live now. That floors me, but Walmart really does serve a purpose as much as I hate to admit.

@mbz32190: I complained about WalMart constantly when I lived in the suburbs, then I moved into downtown Washington DC. I had gotten a $15,000 raise and my wife and I could hardly afford to eat. Food cost three times as much in downtown DC as it had in the suburbs. My wife and I ended up just driving out to the suburbs to go to WalMart ever weekend. We were the lucky ones, many of our poorer neighbors didn’t have cars and had no option but to go the local Bodega to buy milk and eggs.

i always wondered where wal-mart or other big stores would fit in a metro like NYC. i know, build up, smash the mom n pop store to get their space, but c’mon. MY wal-mart in the south covers at least 4 city blocks. top that.

Ugh. Walmart. Here in San Antonio, the only options to shop at, really, are Walmart and HEB. HEB did a Walmart and drove all the grocery stores outta town. But HEB jacked up the prices after that. Im guessing no one knew that was coming, now that HEB is pretty much the only source for groceries? Evil!!!

If Walmart wants to make inroads into urban areas, I think they need to rethink their approach. I remember when they made the transition from plain-old-walmart to “Super Walmart” (now all the Walmarts are Super Walmarts). I think they need to do that again, but on a bigger scale. Make the store an experience (think Mall of America crossed with Harrods of London). If you did this successfully in one city (probably NYC, but maybe Chicago or Boston), it would be much easier to do it elsewhere.

Note that this is just my opinion on a successful strategy Walmart could use, and I am aware that I am ignoring entirely the question of whether or not this would be a good thing.

@kamikasee: Could walmart pull off an “experience” though? They would certainly need something to compete in NYC, but other than a giant smiley merry go round, I dunno…

and where the heck would they put one in Manhattan? I was impressed when they squished Toys R Us into Times Square, and am more impressed knowing that they’re going to jam a Disney Store in there too, there’s just not a whole lot of open space..

@Joedel263: the stores in times square are ment to be like amusement park attractions. there are other toys r us all over the city. and walmart can’t really open a regular sized walmart in dense areas. they will be have to be pushed out the places where you have to drive to access.

@pecan 3.14159265: Here’s a gimmick for them: Make the whole store alphabetical. New Yorkers like our numbered streets, lettered avenues, etc. Organize the store the same way. That way if you need to buy a turkey and a television (as per the other posting today), they’re right near each other.

While I dislike many of Walmart’s practices (especially on the corporate level), I won’t be opposed to Walmart’s entry within New York City limits provided that:

1) They strictly limit themselves to three (or fewer) location(s) within city limits.

2) Those three locations are placed in neighborhoods in the outer boroughs where there are a lot of residents, but very few existing retail stores within reasonable walking distance. (I know of a few neighborhoods where this situation applies and I think those are the very same neighborhoods that could potentially benefit from the change)

there aren’t and never were many kmarts in nyc. and yes when they came in, smaller retailers did go away. not to say it was completely kmarts fault, they were struggling for a while (in the early 90s) and kmart just timed it correctly.
walmart can come in and also displace smaller businesses that have probably been struggling for a while. would it be totally walmart’s fault probably not, but it would be the nail on coffin for many.
the city’s real estate is crazy regardless of the economy at large. walmarts will have to be in the outer outer boroughs, like ikea, it will not be easy to get to.
staten island has been lobbying for a walmart for years. it’s still hard to imagine how it will play out. the land is scarce and population dense with far more options than the usual walmart locales (where they came in as the only game in town). this is as good of a chance walmart will get. i don’t know if it will ever payout like they want it to, unless they are just in it for status.

Yeah, the happyface is gone now anyway. Its just a stupid starburst now.
Yes, this could be good for jobs. Sometimes it brings a few prices down but really its only good if you have sales fliers to bring in and match. Otherwise anyplace with multiple retailers usually manages to beat prices quite easily with sales.
Sure, you might have to wait a bit to buy the thing your looking for but you’ll be saving so who cares?

Downtown Phila. has been a retail shopping basket case (or what that be an “un” basket case) for decades now. And, an expansion of Wal-mart, etc. isn’t going to make that better. There are so few places with enough resources (i.e., land) for that kind of operation in the downtown area. Add to that the congestion that will get far worse when the 2 casinos open ( hopefully not) on Delaware Ave. and even more people will choose to hop over the Ben Franklin & Walt Whitman bridges to shop in Cherry Hill NJ.

@DirectMailFan: FYI only one seems to be opening up on Delaware ave. The one set for Columbus (coincendentally it was slated to be just north of the South Philly Walmart) isn’t likely to open at that location but should be heading for the old Strawbridge’s building near city hall.

The biggest problem, which no one has addressed, is that these big box stores don’t translate all that well in NYC. Those new, clean, huge stores full of attractive merchandise and friendly sales staff you find elsewhere in suburban America end up as dirty, poorly stocked, understaffed behemoths here. Big box stores rely on one main ingredient for their success: lots and lots of cheap real estate easily accessed by trucks. That is it. Once they have to pay NYC real estate prices and deal with our traffic and parking, they start cutting corners everywhere: staffing, training, store upkeep, stocking. Don’t believe me? Visit the Atlantic Ave Target or the sad and filthy Astor Place K-Mart. The Red Hook Ikea is rapidly headed in that direction, too.

@Eyebrows McGee (now with more baby!): I would like to point out that that is my homage to Ghostbusters. I wanted to recreate the Stay-Puft Marshmallow Man’s arrival, but you work with what you can find that’s appropriately licensed on Flickr.

You can see in this still from the film that he’s walking past that freaky white building at the south end of Columbus Circle:

I think that they are a helluva better company than you run. I don’t see you lowering costs to the consumer (especially the ones that live in the inner city as mentioned in the article).In fact , you’re probably afraid to get your hands dirty actually going into some of these neighborhoods. (I know I am).

In this fantasy world that you would love to live in without Walmart,there are fewer choices. Got that ?

Here’s an idea so crazy that it might just work- Let the residents in these cities decide for themselves if Walmart is their kind of place.

@gqcarrick: yes walmart does not pay their employees the best, but it is a retail job. how much do you expect them to be paid?

looking at that link it talks about the unions trying to put pressure on Walmart. they do this because Walmart is one of the largest employers in the country, and the unions want in on that. my father in law won’t shop there because they are non union, all the union would do is make more money for themselves, that’s what they have always done, and that would raise prices making much harder for some families to buy basic necessities.

Walmart has been running their company better than others for years which is why they got to where they are at now, they did not start with hundreds of stores, the started with one. local businesses may not be able to compete in all areas, basically if you do not like Walmart don’t shop, there vote with your money.

the only problem i have with walmart is that everyone seems to think they have the lowest prices around, i have found that many times this is not true. but if they do have the lowest price then i will buy it from there.

You’re serious? Yeah, those local businesses never lobby or pressure elected officials, certainly not in the Bronx, where they pressured the city to essentially prohibit a new supermarket from moving into the Armory site.

So you’re saying that it’s ok for a city government to selectively decide what large companies get to do business there? Isn’t that encouraging the kind of political engineering that you, correctly, abhor?

@HesNoKennedy: That’s what I’m thinking–that though Chicago is a fairly sprawling city, if you’re in a position to get cheaper stuff by shopping just out of your neighborhood, you’ve already got that option, so this isn’t likely to be transformative. The ’06 plan was for 5 Wal-Marts throughout the South Side; while there was traditional Chicago sleaze in the process of planning that, they were at least in some locales where they might actually have offered a decent alternative for the actual neighborhood.

Ikea is an excellent comparable business to Walmart, one that’s overlooked often. They espouse all the same things that Walmart critics hate. (Outsourcing, cheaply made products, “big-box” stores, low wages for floor employees etc.) Yet they seem to evade the same organized resistance that Walmart gets.

I completely agree with your conclusions. A large portion of Walmart criticisms are thinly veiled elitist insults to those considered unworthy of making their own decisions. And the ones who suffer the most are the urban poor who are forced to accept reduced buying power; thanks to government “protection” that forces them to pay more of their income for necessities.

@Snarkysnake: actually in my neighborhood the furniture stores cater to a completely different crowd than ikea. they sell things that are not ikea looking and aren’t assemble yourself. people intend for those pieces to last well into retirement. many people here prefer that, while i prefer a different style of furniture at a different price point because i don’t intend to keep them for decades and decades.
so when ikea opened in brooklyn, my local furniture stores weren’t affected. there’s also an ikea in new jersey that was there before, along with walmarts, costcos and others. if anyone in the city wanted to go to one they always could if they had a car. i doubt they could build a walmart in nyc somewhere people wouldn’t have to drive to.

@LostAtoll: And Mexicans are taking our jobs and terrorists will take over the world UNLESS WE ACT NOW AND SIGN THIS LEGISLATION THAT WILL SOLVE ALL OF OUR PROBLEMS AND KEEP OUR PUPPIES AND ELDERLY CITIZENS SAFE AT NIGHT.

It does suck. One opened up in Madison (West side, of course), everyone was so excited for some reason… it is just more greasy shit food. All those ads just create an artificial want for that crap. Ugh. Tater tots with cheese on them? Puhlease.